China, Peru and Brazil are planning to build a mega transoceanic rail link connecting Peru’s Pacific coast to Brazil’s Atlantic coast. The investment in rail project to be funded by China is pegged at $10 billion and is expected to take six years to complete.
It will give a much-needed boost to trade and economy among the three countries involved. The main purpose of this project is to reduce time and cost of shipping grain and minerals from South America to Asia. China would have an easy access to raw material while the South American economy would revive. It will also give momentum to regional trade in South America. The link which is going to cut through the gigantic and lush green Amazon rainforest will give impetus to tourism as well.
Peru and China signed a bilateral free trade agreement in 2010. Ever since 2012, China has served as a leading market for Peruvian exports. The rail link is likely to push exports in oil, mining, agricultural, fishery and forestry sector. In return, China has become leading capital goods supplier to Peru and has pledged investment worth $14billion as of today.
However, despite its economical benefits, the project has raised concerns among many environment protection groups and organizations across South America. The length of the rail link is going to be around 5,300 km and a huge portion of the link passing through densely forested areas of Amazon can apparently have a serious impact on the environment. Moreover, Peru is already grappling with the impact of deforestation due to rapid industrialization. According to a study by Brazil based environment group, the route would leave 600 indigenous communities vulnerable by disturbing their habitat.
Most probably, China is likely to have an upper hand during the construction of the link through Peru due to its vast experience in rail infrastructure projects and a high safety record. The worry is that China is already operating rail projects in many other countries where they have faced a lot of problems from environmental groups by overlooking regional environmental concerns. The South American countries need to be vigilant during the course of the project and forbid any damage to their environment. Environmentalists and human rights activists should be made an integral part of discussion and be thoroughly consulted before implementation and during the course of the project.
Image Source: “Ferrocarril Central Andina 5 (4800m)” by Maurice Chédel – Maurice Chédel. Licensed under Public Domain via Wikimedia Commons